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730 F.

2d 421

NATIONAL BANK OF DETROIT, Plaintiff,


v.
Francis D. SHELDEN, et al., Defendants.
The TRUST COMPANY OF the VIRGIN ISLANDS, LTD.,
(No. 82-1905)
and Peter J. Cipollini, (No. 82-1737), Defendants-Appellants,
v.
L. Bennett YOUNG and Detroit Bank and Trust Company,
Second
Successor Co- Trustees, Intervening Defendants-Appellees.
Nos. 82-1737, 82-1905.

United States Court of Appeals,


Sixth Circuit.
Argued Dec. 1, 1983.
Decided March 8, 1984.

Peter J. Cipollini, Charles E. Wilson, Jr. (argued), Cincinnati, Ohio, for


plaintiff.
Michael Golob (argued), Ivan E. Barris, Detroit, Mich., for defendants.
Before JONES and KRUPANSKY, Circuit Judges, and PHILLIPS, Senior
Circuit Judge.
PHILLIPS, Senior Circuit Judge.

This litigation began with the filing of a complaint in the nature of an


interpleader by the National Bank of Detroit pursuant to 28 U.S.C. Sec. 1335.

Francis D. Shelden, a native of Michigan, established a revocable inter vivos


trust on September 18, 1976, naming as trustee the Trust Company of the
Virgin Islands, Ltd. (sometimes referred to herein as the Virgin Islands Trust
Company.) The trustee was identified as having been organized in the British

Virgin Islands. The principal question presented in this litigation is who are the
present trustees of this trust.
I.
3

The complaint stated that as of May 1, 1978, the National Bank of Detroit held
the sum of $218,900.07 on deposit in the corporate account of Windigo Ranch,
Inc. and $4,955.25 on deposit in the corporate account of FDS Land Company;
these funds were claimed by defendant the Trust Company of the Virgin
Islands, Ltd. as trustee of the Shelden trust; and that the funds also were
claimed by defendant Alger Shelden, Jr. (brother of Francis D. Shelden) and L.
Bennett Young as officers of the two corporations.

The trust instrument1 was filed as an exhibit to the complaint, together with a
list of shares of marketable securities in twenty-four corporations constituting
the corpus of the trust. The securities were valued by Shelden at approximately
two million dollars. In his de bene esse deposition, Shelden testified that he
delivered these securities to Adam Starchild, founder and original owner of the
Virgin Islands Trust Company.2 Included in the corpus of the trust were all the
issued and outstanding stock of defendants FDS Land Company, a Michigan
Corporation, and Windigo Ranch, Inc., a Colorado Corporation. All the
corporate stock of both these corporations were owned by Shelden at the time
of the establishment of the trust.

The Trust Company of the Virgin Islands averred that as Trustee it had
removed Alger Shelden, Jr. and Young as officers of both corporations and had
elected defendant Samuel Glasser of Michigan as president and treasurer and
defendant Ronald J. Zadora as secretary of the two corporations. Glasser
claimed to be the sole designated beneficiary of both bank accounts.

Alger Shelden, Jr. and L. Bennett Young averred that The Trust Company of
the Virgin Islands, Ltd. had been replaced as trustee of the Shelden trust before
its purported action attempting to remove them as corporate officers.

Francis D. Shelden was named as party defendant to the interpleader action. He


filed no pleading, but was not dismissed as a party defendant. His de bene esse
deposition is a part of the discovery evidence. The complaint also averred on
information and belief that Francis D. Shelden currently was being sought by
the Federal Bureau of Investigation under a fugitive warrant and that his
whereabouts were unknown to the plaintiff bank.
Also named as a defendant to the interpleader action was Edward Brongersma

Also named as a defendant to the interpleader action was Edward Brongersma


of the Netherlands, who was found by the district court to have been appointed
first successor trustee of the trust, replacing The Trust Company of the Virgin
Islands, Ltd. as trustee. His affidavit was filed in the discovery proceedings and
is a part of the record.

L. Bennett Young and the Detroit Bank and Trust Company were permitted by
the district court to intervene as defendants in the interpleader action in their
capacities as second successor co-trustees of the Shelden trust.

10

In its interpleader complaint, National Bank of Detroit tendered all funds in the
two bank accounts for deposit with the clerk of the district court and prayed
that the defendants be required to answer and settle their respective claims to
the bank accounts on deposit by the two corporations. The district court
authorized the clerk to receive these funds.

11

An answer to the complaint was filed by L. Bennett Young and the Detroit
Bank and Trust Company, asserting that they are the second successor trustees
of the trust; and that as successor trustees they are entitled to both bank
accounts. The answer of The Trust Company of the Virgin Islands, Ltd.
claimed that it is the trustee of the trust and is entitled to the funds in both bank
accounts. Appellant Peter J. Cipollini filed an answer asserting that he is the
duly elected president and treasurer of both Windigo Ranch, Inc. and FDS Land
Company and the duly authorized signatory of both corporations and prayed
that all the funds of the two corporations be transferred to him.

II.
12

After discovery proceedings, including the deposition of Francis D. Shelden de


bene esse, a motion for summary judgment was filed on May 17, 1982 by L.
Bennett Young and the Detroit Bank and Trust Company in their asserted
capacities as second successor trustees of the trust. The motion for summary
judgment was opposed vigorously by the Virgin Islands Trust Company.

13

District Judge Charles W. Joiner on August 20, 1982 granted the motion for
summary judgment, finding that L. Bennett Young and the Detroit Bank and
Trust Company are lawful and proper second successor trustees of the Francis
D. Shelden Revocable Inter Vivos Trust; that the second successor trustees are
the rightful owners of all the outstanding shares of stock of FDS Land
Company and Windigo Ranch, Inc.; and that the two second successor trustees
are entitled to the funds on deposit with the Clerk of the Court on behalf of
Windigo Ranch, Inc. and FDS Land Company. The findings of fact and

conclusions of law of Judge Joiner are made Appendix No. 2 to this opinion.
On August 23, 1982, Judge Joiner entered a judgment that the Clerk of the
Court pay to L. Bennett Young and Detroit Bank and Trust Company on behalf
of FDS Land Company and Windigo Ranch, Inc., the funds on deposit, together
with all accrued interest.
14

On August 24, 1982, Judge Joiner received a mailgram from Adam Starchild,
Box 1608 Tarpon Springs, Florida, attacking L. Bennett Young and charging
that "he will resort to any method to illegally obtain the funds to which he
knows he has no entitlement, and no money should be handed over to him."
Judge Joiner ordered the parties to respond to this mailgram. After considering
the responses and the deposition of L. Bennett Young, taken on August 19,
1982, in other litigation3 between the parties in the United States District Court
of Puerto Rico, Judge Joiner on October 4, 1982 denied the motion for
rehearing filed by the Trust Company of the Virgin Islands.

15

The Trust Company of the Virgin Islands, Ltd. and Peter J. Cipollini appeal.
We affirm.

III.
16

A party seeking summary judgment bears the burden of proving there is no


genuine issue of material fact. The evidence must be viewed in the light most
favorable to the non-movant. In Glenway Industries, Inc. v. Wheelabrator-Frye,
Inc., 686 F.2d 415, 417 (1982), this court wrote:

17

The court of appeals is mandated to apply the same test in passing upon an
award of summary judgment as that utilized by the trial court to grant the
motion. Howard v. Russell Stover Candies, Inc., 649 F.2d 620 (8th Cir.1981).
Accordingly the conclusions of the trial court are not protected by the "clearly
erroneous" rule, Luckett v. Bethlehem Steel Corp., 618 F.2d 1373 (10th
Cir.1980), but rather the appellate tribunal, viewing the evidence in the light
most favorable to the party opposing judgment, must determine if a genuine
issue of material fact exists. Smith v. Hudson, 600 F.2d 60 (6th Cir.1979), cert.
denied, 444 U.S. 986, 100 S.Ct. 495, 62 L.Ed.2d 415 (1979). See also Security
National Bank v. Belleville Livestock Commission Co., 619 F.2d 840 (6th
Cir.1980).

18

Accord: New Jersey Life Insurance Co. v. Getz, 622 F.2d 198, 200 (6th
Cir.1980).
In applying this standard, we look to the record to determine whether there are

19

In applying this standard, we look to the record to determine whether there are
any genuine issues of material fact.

IV.
20

We reemphasize that the controlling issue presented by the interpleader


complaint is who are the trustees of the trust established by Francis D. Shelden.
The district court found: (1) that the original trustee named by the settlor was
the Trust Company of the Virgin Islands, Ltd.; (2) that the original trustee was
removed legally and in accordance with the provisions of the trust instrument
and on April 13, 1978 Edward Brongersma of the Netherlands was named as
first successor trustee; (3) that thereafter, the first successor trustee was
removed legally and in accordance with the trust instrument; (4) that L. Bennett
Young of Michigan and the Detroit Bank and Trust Company were named
second successor co-trustees; (5) that the settlor, in his de bene esse deposition,
reaffirmed the fact of each of the foregoing steps; and (6) that L. Bennett
Young and the Detroit Bank and Trust Company are the lawful and proper
second successor co-trustees.

21

Viewing the evidence in the light most favorable to Appellants, we conclude


that there is no genuine issue of material fact as to the identity of the present
trustees of the trust. The trust instrument (See Appendix No. 1 hereto) gave
both the settlor and the protector of the trust express authority to remove
trustees and appoint successor trustees. Each of the changes in trustees was
made in accordance with the provisions of the trust instrument; they were
verified by documentary evidence, and ratified by Francis D. Shelden in his de
bene esse deposition.

22

In the course of the discovery proceeding, Appellees filed a motion for leave to
take the deposition of Francis D. Shelden de bene esse pursuant to Federal Rule
of Civil Procedure 32. Over the objection of Appellants, on November 24, 1981
Judge Joiner ordered that the deposition be taken de bene esse in the
Netherlands at a date and time to be arranged between counsel for the parties.
Full opportunity to be present for the deposition was accorded by the district
court to counsel for Appellants, but they did not participate.4

23

The de bene esse deposition was taken on March 31, 1982, at the time and
place scheduled, but counsel for Appellants did not make an appearance.
Counsel for Appellees waited one hour for opposing counsel to appear, then
proceeded with the deposition at 10 a.m. Counsel for Appellants in a letter to
counsel for Appellees offered the explanation that Starchild had been out of jail
only two weeks and his Parole Board refused to permit him to travel. The

record contains no explanation as to why counsel for Appellants could not have
interviewed Starchild in jail or immediately after his release from incarceration.
24

On June 18, 1982 counsel for Appellants filed a motion to suppress the Shelden
deposition because he had not signed it. Judge Joiner ordered that the
deposition be submitted to Francis D. Shelden for reading and signing in
accordance with Federal Rule of Civil Procedure 30. In all other respects
Appellants' motion to suppress the deposition, or for an evidentiary hearing,
was denied by the district court.

25

On July 9, 1982 Francis D. Shelden signed and swore to the deposition, with
the following attestation:IN WITNESS WHEREOF, I have hereunto set my
hand and affixed my notarial seal at Detroit, County of Wayne, State of
Michigan, this 15th day of April, 1982 A.D.

/s/ ALTON D. COBB, JR.


26
RPR, CSR-2520
Notary Public, Wayne County,
27
Michigan
My Commission Expires:
4/24/82
28

I, Francis D. Shelden, who, being first duly sworn, does depose and say that on
this 9 day of July, 1982, he has read the foregoing deposition transcript in its
entirety and that the transcript is a full, complete and accurate record of his
testimony during said deposition.

/s/ FRANCIS D. SHELDEN


29
The undersigned,
30
Meester Leo Johannes Willem Marie Schroeder, notaris with office in Amsterdam,
31
32
declares
that the signature on this page is the signature of Meester Francis D.
Shelden, the Deponent herein, who has solemnly affirmed before me, a notaris, that
his statement is the truth, the whole truth and nothing but the truth.
Amsterdam, 9--7--, 1982.
33

/s/ LEO JOHANNES WILLEM MARIE SCHROEDER


34
[SEAL]
35
36

Francis D. Shelden testified that he was born in Detroit, Michigan on


September 5, 1928, a son of Alger Shelden; that he had only one sibling, a
brother, Alger Shelden, Jr.; that he received a Bachelor of Arts degree from
Yale University; that he served in the United States Air Force during the
Korean War; that he owns and flies his own plane; that he received a Master of
Science degree in geology from Wayne State University; that he completed his
course work for a Ph.D. degree at the University of Michigan, but had not
completed his doctoral thesis; that he had been active in exploration for oil in
Michigan and in real estate projects with his father and brother, earning a
substantial income; and that he inherited considerable wealth from his father
and grandfathers, Henry D. Shelden and Russell A. Alger.

37

Shelden testified that in 1976 he owned approximately two million dollars in


marketable securities which he had inherited; and that he also owned other
assets, including a condominium in Colorado and undeveloped land in and
around Charlevoix, Michigan. He also owned all the stock in FDS Land
Company and Windigo Ranch, Inc., which were being managed by L. Bennett
Young.

38

The events leading to the involvement of Shelden with Adam Starchild and the
creation of the revocable inter vivos trust were described by Shelden as follows:

39

In July 1976 Shelden received a telephone call from Deyer Grossman who said
that a mutual acquaintance by the name of Gerald Richards was having severe
"difficulties" and that Richards might involve Shelden in these "difficulties";
and that Shelden might become the subject of blackmail by Richards. Shelden
testified that Grossman "suggested that it might be wise for me to leave the
country for awhile ... to await events." Shelden said that his immediate concern
was protecting his assets, especially his negotiable stocks. He asked Grossman
for advice. Grossman suggested that Shelden contact Adam Starchild, an
investment counseler specializing in offshore investments. Shelden had never
met Starchild but telephoned him in New Jersey and asked for his advice.
Starchild recommended that Shelden bring his stock certificates to New Jersey
and discuss the matter with him further.

40

Shelden removed the securities from his bank safety deposit box and took them
with him to New Jersey. Starchild convinced him of his alleged expertise in

establishing tax shelters. He recommended that Shelden form an offshore trust


with his assets. The stock certificates thereupon were lodged in a vault in the
Mid-Atlantic Bank of New Jersey. A loan was obtained, secured by some of the
shares of stock, and two bank accounts of between $30,000 and $40,000 were
opened, one in the name of Shelden and the other in the name of Starchild.
Shelden explained the purpose of Starchild's account was "so he would have
some money for administering my affairs." Starchild indicated that he was
going to form a company specifically for the purpose of administering the trust
to be created by Shelden. Shelden then left his securities with Starchild and
flew to Europe via Canada and the Bahamas. While in Canada he notified his
family by telephone that there may have been a little "problem" and he would
be away for a while.
41

A meeting took place at a house owned by Shelden in Antigua, British West


Indies, attended by Shelden, his brother, Alger, Jr., L. Bennett Young and
Adam Starchild. There was a general discussion as to how Shelden's assets
should be managed. Starchild stated that a trust was essential and recommended
an irrevocable trust. Young expressed doubt that a trust was necessary but took
the position that in all events an irrevocable trust would be unwise. At the
insistence of Young, a revocable trust was decided upon. The trust instrument
was signed September 28, 1976 by Francis D. Shelden, Settlor, and The Trust
Company of the Virgin Islands, Ltd. by Adam Starchild. The trust instrument
was witnessed by Alger Shelden, Jr. and L. Bennett Young. Francis D. Shelden
retained the express right to modify or terminate the trust altogether, including
the power to remove the trustee and appoint a successor trustee or trustees. On
October 9, 1976 Shelden, as Settlor, appointed L. Bennett Young as protector
with the concurrent power to remove trustees and appoint successor trustees.
Starchild, as director of The Trust Company of the Virgin Islands, Ltd.,
acknowledged the appointment of Young as protector of the trust. Following
the execution of the trust instrument, Shelden returned to Europe.

42

In December 1976 Starchild reported to Shelden by telephone that the State of


Michigan had issued criminal warrants for the arrest of Shelden. Starchild
indicated to Shelden that he was coming under scrutiny by the Federal Bureau
of Investigation.

43

In 1977 Shelden requested an accounting from Starchild as to the status of his


assets for income tax purposes. Although Starchild had promised Shelden
quarterly financial statements, no certified accountings were received
throughout 1977. Finally, in 1978, after repeated requests, Starchild sent to
Shelden a list of his stock dividends for 1977. Shelden testified that the list was
erroneous--that he checked Starchild's figures with his own calculations based

on his known securities and a copy of Standard & Poors and found Starchild's
figures to be grossly in error. He demanded an accounting. He testified that "I
became increasingly concerned. After the beginning of the year I wanted the
books closed and I needed a final accounting for tax purposes." He testified that
he "kept pestering" Starchild for an accounting of dividends received in 1977;
that Starchild kept telling him " 'Oh, the accountants are working on it' " and
"that sort of thing. 'They will have the final figures next Thursday.' " Shelden
testified that Starchild "went on for several months and I became increasingly
concerned as April 15 drew nearer" .... "I never received anything in written
form ... [that] [h]e talked vaguely about having other accounts." Finally, after
consulting with a Dutch tax lawyer, Antoon Kasdorp, Shelden decided that the
time had come for him to remove The Trust Company of the Virgin Islands as
Trustee and appoint a successor trustee. He advised Starchild of this decision
by telephone. On April 13, 1978, Shelden executed a document removing The
Trust Company of the Virgin Islands as trustee and naming Edward
Brongersma as successor trustee. This document was notarized in Amsterdam
and complies in all respects with the provisions of the Trust Instrument.5 5]
Brongersma accepted the appointment the same day.6
44

Shelden testified that Brongersma for many years had been "a Senator, a Dutch
equivalent. He was a member of the Upper House of the Dutch Government;
was chairman of the Judicial committee; was a lawyer, doctor of law."In his
deposition, Antoon Kasdorp stated that he served the papers removing The
Trust Company of the Virgin Islands upon Starchild in person April 20, 1978.7

45

Shelden testified that the removal of The Trust Company of the Virgin Islands,
Ltd. as trustee was his own decision and his "free and voluntary act."

46

Shelden further testified that "continuing discussions went on about the


administration of the trust and it seemed as though the trustee should be ... in
the United States." Accordingly, on October 16, 1979, L. Bennett Young
exercised his power as protector of the trust, removed Brongersma as first
successor trustee and appointed himself and the Detroit Bank and Trust
Company as second successor co-trustees.8

47

Shelden testified that the appointment of Young and the Detroit Bank and Trust
Company as second successor trustees was done with his approval and consent.
He ratified the appointment in writing.9

48

Brongersma acknowledged his removal as first successor trustee.10 The


signature and seal of the L.J.W.M. Schroeder, notary, were duly verified by

Robert E. Sorenson, United States Vice Consul.


49

Brongersma also executed the affidavit quoted in the note. 11 The signature and
seal of the Notary were duly verified.

50

Shelden further testified as follows:Q. Now, was Mr. Starchild to do anything


regarding the assets when he was removed?

51

A. Yes. The understanding was that upon his removal, he would do two things:
He would provide a final accounting, of course, and he would render the assets
to a representative for the successor trustee.

52

Q. Well, what did Mr. Starchild do after he was served with the removal
papers?

53

A. He did nothing.

54

Q. When you say he did nothing, did he turn any assets over to Mr.
Brongersma?

55

A. No.

56

Q. Any representative of Mr. Brongersma?

57

A. No.

58

Q. Anything to Mr. Kasdorp?

59

A. No.

60

Q. Anything to you?

61

A. No.

62

Q. Did he give you an accounting?

63

A. No.
Q. Did there come a time when Mr. Young got more in the foreground?

64

Q. Did there come a time when Mr. Young got more in the foreground?

65

A. Yes, yes definitely, later.

66

Q. All right.

67

When did that happen?

68

A. That happened as continuing discussions went on about the administration of


this trust, and it seemed as though the trustee should be, should be an
American, or it should be in the United States.

69

Q. All right, and did Mr. Young, at some point, indicate something to you
about this situation?

70

A. Yes. Well, he exercised his power as Protector of the trust, later, to have
Edward Brongersma removed and appointed himself and the Detroit Bank &
Trust Company as trustees.

71

Q. All right.

72

Was Mr. Young's actions done with your prior knowledge?

73

A. Yes, I believe so.

74

Q. And was it done with your prior consent?

75

A. Certainly with my consent.

76

Q. All right.

77

Let me show you, Mr. Shelden, what's been marked as your Deposition Exhibit
No. 5, and ask you if you can identify that for us, please?

78

A. Yes. This is an instrument which removed Edward Brongersma as successor


trustee and appoint L. Bennett Young and the Detroit Bank & Trust Company
of Detroit as the new successor trustee.

79

Q. All right.

80

Did you receive a copy of this document shortly after the date it appears, which
is October 16, 1979?

81

A. Yes.

82

Q. All right, and was this in accordance with your understanding of what Mr.
Young was going to do?

83

A. Yes.

84

Q. All right.

85

Now Mr. Shelden, let me show you what's been marked as Shelden Deposition
Exhibit No. 6, and see if you can identify that for us, please?

86

A. Yes; Settlor's Acknowledgment of Removal of Trustee and Appointment of


Successor Trustees. This is a document which I signed, executed here, and
acknowledged here in Amsterdam, notarized here, in which I acknowledged
that I concurred with and knew about the appointment of the successor trustees.

87

Q. Is that your signature, by the way?

88

A. Yes, it is.

89

Q. And by the way, did you do this freely and voluntarily?

90

A. Yes, certainly.

91

Q. And you knew what you were doing?

92

A. Yes.

93

Q. All right.

94

I'd like to show you Shelden Deposition Exhibit No. 7, and see if you can
identify that for me, please?A. Yes. This is the Acknowledgment of Removal
of Successor Trustee in which Edward Brongersma acknowledged that he was
being removed as successor trustee.

95

Q. All right, and did Mr. Brongersma sign this in your presence?

96

A. Yes, he did.

97

Q. Okay.

98

No one forced Mr. Brongersma to sign this document?

99

A. No, no.

100 Q. All right.


101 Let me show you a document which has been marked Shelden Deposition
Exhibit No. 8, and see if you can identify that for me?
102 A. Yes. This is a document in which L. Bennett Young and David C. Wind,
acting on behalf of Detroit Bank & Trust Company accepts their appointment as
successor trustee.
103 Q. All right, and you received a copy of this document?
104 A. Yes.
105 Q. And did that comport with your understanding of the situation?
106 A. Yes, it certainly did.
107 Q. And did you agree with it?
108 A. Yes.
***
109
110 But, the next thing I learned was that a couple representatives from the trust
company of the Virgin Islands had presented themselves to the Detroit Bank &
Trust where some of the assets from--of mine were lodged-111 Q. Let me see, are you sure at Detroit Bank & Trust?

112 A. Excuse me, I'm sorry, it was the National Bank of Detroit.
113 Q. And do you recall how you were informed of this?
114 A. I don't recall, specifically, right now. It was some--it was, perhaps--it was
from Bennett Young, but I'm not absolutely certain.
115 Q. Can you recall whoever told you, what in essence the conversation was?
116 A. Yes. Two representatives--two people had presented themselves at the
National Bank of Detroit demanding where the assets--from my incorporations
were.
117 Q. Now, this is the perfect time, I think, to ask you something about this.
118 Do you recall what corporate assets were at the National Bank of Detroit, at this
time?
119 A. There was cash from two corporations.
120 Q. All right.
121 Do you recall the name of the corporations?
122 A. Yes; the Windigo Ranch Corporation and the FDS Corporation.
123 Q. Let's back in a bit in time. Do you recall when FDS and Windigo were
formed?
124 A. Yes; they were formed at or very shortly after our meeting in Antigua, in
October of 1976.
125 Q. Okay.
126 Do you recall who formed those two corporations?
127 A. Yes. I-Q. Who did the legal work, I should say?

128

Q. Who did the legal work, I should say?

129 A. Yes; Bennett Young did.


130 Q. Okay, and do you recall what the purpose of FDS was for?
131 A. FDS was to receive the assets and the cash as it came in for the property that
I held jointly with the estate of John Wreford and his wife in Charlevoix.
132 Q. Was it in developed land in Charlevoix?
133 A. Yes; Charlevoix County.
134 Q. It was the intent to gradually sell that land off?
135 A. Yes.
136 Q. And whatA. We'd been involved in that before I left the United States,
selling the land.
***
137
138 Q. Could I, could I do this, Mr. Shelden, could you pick up Exhibit 1 which is
the Francis D. Shelden Revocable Trust, turn to the last page, please?
139 A. Yes.
140 Q. Does that refresh your recollection?
141 A. Yes. One thousand shares Windigo; one thousand shares FDS Land
Company.
142 Q. Now, who was to be the owner of those shares of stock, at least September
28th, '76?
143 A. I would have to ask you what you mean by owner?
144 Do you mean-Q. It was transferred, was it not, to the trust?

145

Q. It was transferred, was it not, to the trust?

146 A. Yes, it was transferred.


147 Q. All right.
148 Now, when, when you removed the trust company in 1978-149 A. Yes.
150 Q. --was it your intention also, to transfer ownership of those shares of stock to
your successor trustee?
151 A. Yes, of course.
152 Q. All right, and did Mr. Starchild comply with your request to do that?
153 A. No, he certainly did not.
154 Q. All right, and when we go to 1979, when Mr. Young and Detroit Bank &
Trust Company are appointed as second successor company trustee, what was
your intention regarding those stocks?
155 A. Well, it would, like everything else, it would go to Mr. Young and Detroit
Bank & Trust Company as trustees.
***
156
157 Q. Regarding FDS and Windigo, was it your intention, in 1978, that your first
successor trustee, Mr. Brongersma own all the shares of stock in that--in those
two?
158 A. Yes, it was, as trustee.
159 Q. Right, and in 1979, what was your intention regarding those two
corporations?
160 A. That as trustee, the assets in those two corporations be owned by Mr. Young
and the trust company, Detroit Bank & Trust Company.

161 Q. Okay.
162 Today, March 31, 1982, who do you consider to be the valid trustees of your
trust, Mr. Shelden?
163 A. The valid trustees of my trust are L. Bennett Young and the Detroit Bank &
Trust Company.
164 Q. And who do you claim are the proper owners of stock in FDS Land and
Windigo Ranch Corporation?
165 A. L. Bennett Young and the Detroit Bank & Trust Company.
166 Q. And who would be entitled to the funds in the bank account and forms the
base of this action, Mr. Young?
167 A. L. Bennett Young and the Detroit Bank & Trust Company.
168 Q. Are you aware, Mr. Shelden, of your fugitive status in the United States?
169 A. Yes.
170 Q. Are you aware of the fact what Mr. Young and Detroit & Trust Company's
position is with regard to transferring assets to you?
171 A. Yes; they absolutely cannot do that.
172 Q. And you recognize that?
173 A. Yes.
174 Q. You recognize you'll not receive assets from Detroit Bank & Trust Company
and Mr. Bennett as long as you're a fugitive?
175 A. Yes, I recognize that.
176 Q. And you still wish them to be your trustees?

177 A. Yes, I do.


178 Q. Mr. Shelden, in all the--by the way, what was the last communication of any
kind that you had with Mr. Starchild?
179 A. Well, I mentioned that I had received word that two people, saying that they
were representatives of the Detroit--representing the trust company of the
Virgin Island had presented themselves to National Bank of Detroit and
demanded all the cash that was there.
180 This worried me very much. I sent a letter to Starchild saying "I find this action
absolutely inexplicable, I await your explanation," and I received from him, I
believe, the last--in 1978, the last communication that I had from him, the
telegram he sent to me saying, "I suggest you telephone me, there's lots of room
for negotiation."
181 Q. And what did you say?
182 A. I wrote him back at that point, and said "There is no room for negotiation, I
demand an accounting. And any further communication between you and me
shall be carried on with my lawyers."
183 Q. All right, and from 1976 until this last communication, did you deal with
anyone else associated with The Trust Company of the Virgin Islands Limited
other than Adam Starchild?
184 A. Essentially, no. The trust company of the Virgin Islands was Adam
Starchild's alter ego.
V.
185 As stated in the opening paragraph of this opinion, the issue of fact in this
interpleader action is who are the present trustees of the Shelden trust. The
evidence summarized above, including both authenticated documents and the
testimony of Francis D. Shelden in his deposition de bene esse, demonstrates
that the two successor trustees are the duly qualified trustees of the trust. We
hold that Judge Joiner did not err in finding that no genuine issues of material
fact existed on this question and in granting the motion for summary judgment.
186 Appellants contend that too many disputed factual questions remain in the case

to permit summary judgment. The Trust Company of the Virgin Islands, Ltd.
places strong reliance on an unauthenticated document entitled "ADDENDUM
TO FRANCIS D. SHELDEN INTER VIVOS TRUST" bearing the date of
April 24, 1978. This allegedly was written eleven days after Shelden had
removed The Trust Company of the Virgin Islands, Ltd. as trustee and Edward
Brongersma had accepted appointment as first successor trustee in full
compliance with the trust instrument as detailed above. The "Addendum" is
dated four days after Antoon Kasdorp, according to his affidavit, personally
served Starchild with the removal papers on April 20, 1978. The "Addendum"
purported to "nominate, constitute and appoint the Trust Company of the Virgin
Islands" as trustee of the "Trusts, hereinabove created" (emphasis supplied),
without bond or "if a bond is required by law it be nominal in amount." The
"Addendum" provided that the British Virgin Islands would be the "situs of the
trust" and that "This Trust shall be governed by and construed in accordance
with the laws of the British Virgin Islands." It bears purported signatures
(which are virtually illegible) over the typed name of "Francis D. Shelden,
Settlor" and Adam Starchild for the Trust Company of the Virgin Islands. It is
not witnessed, notarized or otherwise authenticated. The date, April 24, 1978, is
typed and not authenticated. It could have been inserted at any time. Judge
Joiner correctly concluded that the discovery evidence relied upon by
Appellants was not sufficient to create any genuine issue of material fact as to
the removal of the Trust Company of the Virgin Islands as trustee on April 13,
1978, as testified by Shelden and established by verified documents in the
record.
187 Appellants further contend that the evidence raises serious questions of fact as
to whether the Settlor established the trust for an illegal purpose. This is
irrelevant to the resolution of the issues raised by the interpleader complaint.
The question of the purpose of the trust is not before the Court in this case. We
reemphasize that the only genuine issue of material fact presented by the
complaint is who are the present trustees of the trust. Even if it be concluded
that the trust was established for an illegal purpose, that would not make the
Trust Company of the Virgin Islands the present trustee.
188 Appellants further contend that, because of the illegality of the trust, the Trust
Company of the Virgin Islands is entitled to retain all the assets originally
transferred to the trustee. This contention likewise is unsupported by the record
and is irrelevant to the resolution of the issues raised by the interpleader
complaint.
189 We note that there is nothing in the language of the trust instrument that raises
the slightest suspicion of illegality. Furthermore, with respect to Appellants'

contention that the trust was created for an illegal purpose, we note that the
idea of creating the trust did not originate with Shelden. It was created upon the
recommendation and urging of Starchild, who organized the Trust Company of
the Virgin Islands for the purpose of administering it.
190 In another effort to establish the existence of a genuine issue of material fact,
Appellants assert that L. Bennett Young, who in his capacity as protector of the
trust, removed Brongersma as first successor trustee and appointed himself and
the Detroit Bank and Trust Company as second successor trustees, executed a
resignation as protector of the trust in 1977 or 1978. This assertion is based
upon a deposition given by Young in the case of Shelden v. Trust Company of
the Virgin Islands, Ltd., in which the opinion of the district court of Puerto Rico
is published in 535 F.Supp. 667 (D. Puerto Rico 1982).12
191 Appellants' contention that Young resigned as protector of the trust is
contradicted by Young's deposition. Young testified that Shelden suggested
that he, Young, write letters to newspaper editors, hold a press conference or
appear on television to correct untrue news stories then being published about
Shelden. Young said that his own judgment was to do nothing about the
newspaper articles because to respond to them might cause more articles and
more publicity. Therefore, Young declined to engage in a publicity campaign
on behalf of his client and tendered his resignation as Shelden's attorney if
Shelden desired to accept it. Young testified that Shelden refused to accept his
resignation and destroyed Young's letter. That no resignation of Young ever
occurred, whether as attorney for Shelden, protector of the trust or second
successor trustee of the trust, is made clear by Shelden's deposition as well as
the deposition of Young when read in its entirety.
192 Furthermore, the District Court of Puerto Rico, in the case in which Young's
deposition was taken, did not hold that Young had resigned as protector of the
trust. In Shelden v. Trust Company of the Virgin Islands, Ltd., supra, 535
F.Supp. 667,13 District Judge Cerezo authorized Young and the Detroit Bank
and Trust Company to be added as plaintiffs in that action in their role as
successor trustees of the trust.
193 District Judge Cerezo made the following finding as to the role of L. Bennett
Young under the provisions of the Shelden Trust:
194 When the trust was created, Shelden vested Young with all powers belonging to
him, including the power of removal of the trustee and designation of successor
trustees, prohibiting him only from revoking or modifying the trust. The Trust

Company, acting trustee, acknowledged in writing both receipt of his


appointment and of his authority as set forth in the trust and in the appointment
of protector. According to the powers and the functions assigned to the
protector in the trust instrument, it can reasonably be said that he acts as a
representative of the settlor-sole beneficiary and as guardian of his interests in
the trust. He acts in a fiduciary capacity for the settlor as sole beneficiary of the
trust. The protector is not a party who has been brought to this litigation in a
collusive manner to create diversity jurisdiction which otherwise would not
exist. His existence and authority was acknowledged by defendants since 1976.
He is a person with strong ties to the trust since its creation who was assigned
powers and functions and who accepted the duties imposed upon him. His
authority emanates from the trust instrument itself. Having acknowledged his
authority to act as protector of the trust, defendants cannot now complain when
he discharges the duties delegated to him as such. He is a party with real
interest in the trust and in the accounting sought.
535 F.Supp. at 671.
195
196 Appellants make the further argument that the trust instrument should be
construed according to the law of the British Virgin Islands, and not by the law
of Michigan. No law of the British Virgin Islands is cited that would change the
decision of Judge Joiner as to the identity of the present trustees of the trust.
197 We conclude that the provisions of the trust instrument for removing trustees
and appointing new trustees are too clear and unambiguous to require
application of rules of construction, whether under the law of Michigan or the
law of the British Virgin Islands.
198 We hold that Appellants have failed to establish any genuine issue of material
fact as to the identity of the trustees now entitled to administer the trust. A
factual dispute about immaterial matters does not bar summary judgment.
199 Appellants have failed to establish any issue of material fact as to the identities
of the trustees. "[A]ll that is required [of non-movant] is that sufficient
evidence supporting the claimed factual dispute be shown to require a jury or
judge to resolve the parties' differing versions of the truth at trial." First
National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 289, 88 S.Ct.
1575, 1592, 20 L.Ed.2d 569 (1968) reh'g. denied 393 U.S. 901, 89 S.Ct. 63, 21
L.Ed.2d 188 (1968); Bouldis v. U.S. Suzuki Motor Corp., 711 F.2d 1319 (6th
Cir.1983). This Appellants have failed to do. The purpose of summary
judgment is to eliminate a trial where it would be unnecessary and result in
mere delay and expense, Suzuki Motors, supra, 711 F.2d at 1324. If the record

evidence is not disputed as to any material fact, the case should be decided as a
matter of law rather than submitted to a jury. Id. (emphasis supplied). Here, the
purported issues of fact asserted by the Appellants were not material to the
disposition of the ultimate issue, namely who were the proper trustees to the
Shelden trust, and thus entitled to the monies paid over by the National Bank of
Detroit to the Clerk of the District Court for the Eastern District of Michigan.
Therefore, we hold that Judge Joiner did not err in granting summary judgment
in favor of the second successor co-trustees, L. Bennett Young and the Detroit
Bank and Trust Company.
VI.
200 The summary judgment granted by Judge Joiner in the present case is
supported by the decision of the District Court of Puerto Rico in Francis D.
Shelden, as Settlor of the Francis D. Shelden Revocable Inter-vivos Trust, and
L. Bennett Young, Esq., as Protector of the Trust, v. The Trust Company of the
Virgin Islands, Ltd., and Adam Starchild, Individually and as Director and
Trustee, supra, 535 F.Supp. 667 (D. Puerto Rico 1982). The action was filed by
Shelden and L. Bennett Young, the latter in his capacity as protector of the
Shelden Trust. Defendant Starchild was served with process in Puerto Rico on
August 9, 1978. Shelden and Young sought relief against The Trust Company
of the Virgin Islands, Ltd. and Starchild for breach of trust, alleging that the
trustee failed to perform the trust duties. Plaintiffs sought an accounting in
accordance with the provisions of the trust instrument, full disclosure of
defendants' financial activities, removal of the acting trustee and a transfer of
the corpus of the trust to a successor trustee "so that the same can be preserved
and administered within the jurisdiction and under the laws of the United
States." 535 F.Supp. at 668.
201 Thereafter L. Bennett Young and the Detroit Bank and Trust Company filed a
motion to be added as plaintiffs in their capacities as successor trustees of the
Shelden trust.
202 The district court held that Shelden could not maintain the action because he
was not domiciled in Michigan at the time the complaint was filed, and had no
intention of ever reestablishing a Michigan domicile, and was no longer a
citizen of the United States; and that an action could not be maintained between
a noncitizen plaintiff and a noncitizen defendant.
203 District Judge Cerezo concluded, however, that Shelden is not an indispensable
party; and that Young, as protector of the trust, and Young and the Detroit
Bank and Trust Company as successor trustees, can maintain the action against

the former trustee and Starchild. Young and the bank were admitted as
plaintiffs in their role as successor trustees.
204 With respect to its jurisdiction, the district court pointed out that "during the
years 1977-78 Starchild may have conducted the bulk of the Trust Company's
affairs from Puerto Rico and, as its agent, availed himself of the privilege of
conducting business within the forum state;" and that "Starchild wrote Shelden
twenty-six letters and aerograms from San Juan and was sent twenty-seven
letters by Shelden to his San Juan address and that he [Starchild] sent Shelden
cables from San Juan and phoned him several times from here." 535 F.Supp. at
669.
205 The following quotation from the opinion of District Judge Cerezo is especially
pertinent to the present litigation:
206 Furthermore, and perhaps more important, is the fact that the trust instrument
gave Shelden, as sole beneficiary, and Young, as protector, the right to remove
the trustee and to designate his successor. There was no provision requiring
them to seek approval of the court in the event of removal of the trustee. In the
exercise of the powers vested in them by the trust itself, the acting trustee was
removed and a successor trustee designated. Subsequently, and again in the
exercise of their powers, that successor trustee was removed and other
successor trustees appointed, namely, L. Bennett Young who originally filed
suit as co-plaintiff of protector and The Detroit Bank and Trust Company.
Defendants have not shown any legal impediment to the exercise of that power
by the settlor-beneficiary and/or the protector. There is no reason to believe that
the removal of the defendant trustee and the subsequent designation of the
successor trustees is not a legitimate exercise of those powers. This action is
essentially a proceeding seeking an accounting of the defendant trustee and
successor trustees can bring accounting proceedings against the original trustee
who has allegedly committed wrongdoing in the administration of the trust.
207 Successor trustees having been designated and having requested the Court to
allow them to appear as plaintiffs, we must now determine if the action can be
prosecuted by them in the absence of Mr. Shelden who has been found to be a
party not domiciled in the State of Michigan but in Europe and whose presence
destroys diversity jurisdiction. Since the trust deed invests the protector with
full authority to exercise the rights reserved to the settlor-beneficiary since its
creation and since the successor trustees have been designated in accordance
with the provisions of the trust instrument, they are empowered as such
successor trustees to continue this action. Shelden's presence in the litigation is
neither necessary nor indispensable for the trustees can demand an accounting

from the original trustee and can sue to protect and preserve the trust capital.
Neither Young, as protector, nor the successor trustees are straw parties to this
action. Both the protector and the successor trustees are available to testify and
to be deposed and there is complete diversity between them and defendants.
Were we to conclude that the successor trustees and/or the protector cannot
initiate this action despite their capacity to do so and their interest in the trust,
we would in effect be holding that because the settlor of a trust is a fugitive the
successor trustees cannot have access to the courts to hold liable the
wrongdoing trustee. Even if the settlor were convicted, the successor trustees
could institute accounting proceedings against the original trustee. Although
Shelden's fleeing the jurisdiction to avoid prosecution is an illegal and an
offensive action, the Court having previously exercised in personam and
subject matter jurisdiction, cannot now close the door to the protector or to the
successor trustees of the trust to seek an accounting for alleged acts of
mismanagement and breach of trust by the predecessor trustee.
208 Having concluded that Shelden is not an indispensable party and that the
successor trustees have a legitimate and real interest in the trust, the Court
cannot dismiss this action.
535 F.Supp. at 672.
209
VII.
210 The contentions of Appellant, The Trust Company of the Virgin Islands, Ltd.,
are without merit for the reasons stated above. The contentions of Appellant
Peter J. Cipollini are without merit because he no longer is an officer of FDS
Land Company or Windigo Ranch, Inc. The stock in both corporations is
owned by L. Bennett Young and Detroit Bank and Trust Company, successor
trustees of the Shelden Trust.
211 The summary judgment of the district court is affirmed. The costs of these
appeals are taxed against Appellants.
APPENDIX No. 1
FRANCIS D. SHELDEN REVOCABLE INTER VIVOS TRUST
212 THIS TRUST is executed this 28th day of September, 1976, by and between
FRANCIS D. SHELDEN, hereinafter referred to as the Settlor, and THE
TRUST COMPANY OF THE VIRGIN ISLANDS, LTD., hereinafter referred
to as the Trustee.

213 WHEREAS, Settlor, desiring to create a trust to be known as the FRANCIS D.


SHELDEN REVOCABLE INTER VIVOS TRUST for the purposes
hereinafter set forth, does hereby transfer, assign, convey, and deliver to the
Trustee the property described in Schedule A attached hereto and made a part
hereof, and
214 WHEREAS, it is Settlor's intention that said property, together with such other
property as may be added thereto from time to time, be held in Trust for the
benefit of Settlor and others,
215 NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, it is agreed as follows:
ARTICLE I
ADMINISTRATION DURING LIFETIME OF SETTLOR
216 All of the income, if any, from this Trust shall be distributed to or for the
benefit of Settlor during his lifetime, at least quarter-annually. Settlor may
withdraw any amount or all of the principal of this Trust from time to time.
ARTICLE II
ADMINISTRATION FOLLOWING DEATH OF SETTLOR
Upon Settlor's death:
217 (Section 2.1 makes specific gifts of tangible personal property.)
218 2.2 Specific Gifts. My Trustee shall pay over forthwith free of the Trust the
following sums to the following named institutions and associations:
219 The sum of Twenty-five Thousand Dollars ($25,000.00) to YALE
(A)
UNIVERSITY New Haven, Connecticut.
220 The sum of Five Thousand Dollars ($5,000.00) to CRANBROOK INSTITUTE
(B)
OF SCIENCE, Bloomfield Hills, Michigan.
221 The sum of Ten Thousand Dollars ($10,000.00) to THE UNIVERSITY OF
(C)
MICHIGAN, Ann Arbor, Michigan.
(D) The sum of Ten Thousand Dollars ($10,000.00) to WAYNE STATE
222

UNIVERSITY, Detroit, Michigan.


223 The sum of Five Thousand Dollars ($5,000.00) to THE AMERICAN
(E)
ASSOCIATION OF PETROLEUM GEOLOGISTS of Tulsa, Oklahoma, for the
Publication Fund.
224 (Sections 2.3 and 2.4 establish education trusts for Joseph William Moore and
Barry Del Wood of Charlevoix, Michigan.)
225 (Section 2.5 provides for the distribution of the residue to the children or
grandchildren of Alger Shelden, Jr., brother of Francis D. Shelden, who survive
the settlor.)
226 (ARTICLE III sets forth the powers of the Trustee.)
ARTICLE IV
TRUSTEE
227 4.1. Appointment of Trustee. I hereby nominate, constitute and appoint THE
TRUST COMPANY OF THE VIRGIN ISLANDS, LTD. of Roadtown,
Tortola, British Virgin Islands to act as Trustee of the Trusts hereinabove
created; and I request that it be permitted to act without bond or if a bond be
required by law that it be nominal in amount.
228 4.2. Appointment of Protector. Settlor may by instrument in writing delivered to
the Trustee designate a Protector of the Trust who shall have the authority to do
and perform every act and to exercise every power vested in or reserved to
Settlor in his place and stead as fully as Settlor might do, including the removal
of the Trustee and the designation of a successor Trustee, except that such
Protector shall not revoke, amend or otherwise modify the provisions of the
Trust.
229 (Section 4.3 provides for termination of Trustee in event of insolvency and
other contingencies.)
230 (Section 4.4 provides for Trustee's right to resign.)
231 4.5. Removal of Trustee. The income beneficiary, or a majority of the income
beneficiaries, may, by instrument in writing delivered to the then acting
Trustee, remove said Trustee and replace it with a Successor Trustee of his or

their choice. Such Successor Trustee shall possess and exercise all powers and
authority herein conferred on the original Trustee.
232 4.6. Acts of Prior Trustee. No Successor Trustee hereunder shall be held liable
or responsible in any way for the acts or omissions of a predecessor Trustee, but
shall be liable only for his own acts or omissions with respect to property
received or distributed by him as Trustee.
233 4.7. Trustee Accountability. Settlor, any income beneficiary or person with a
remainder interest, whether vested or contingent, shall have access to the books
and records of any Trustee, other than Settlor, during normal business hours.
Trustee shall account at least annually for all receipts and disbursements to all
income beneficiaries.
234 4.8. Trustee Compensation. The Trustee shall be entitled to receive fair and just
compensation for its services hereunder and shall be reimbursed for all
reasonable expenses incurred in the management and conservation of the Trust
estate. The Trustee is also authorized to employ agents, legal counsel,
accountants or brokers and to pay them fees and expenses as it may be
necessary or advisable to carry out the provisions of this Trust.
ARTICLE V
POWERS RETAINED BY SETTLOR
235 5.1 Settlor or any other person may at any time add any property to this trust,
transferring by Will or otherwise. Settlor reserves the right to amend, modify or
revoke this Trust Agreement, in whole or in part and at any time or times, by
notice in writing to Trustee, and such amendment, modification or revocation
shall be effective immediately upon delivery of such notice to Trustee, except
that changes with respect to Trustee's duties, liabilities or compensation shall
not be effective without its consent. Upon Settlor's death, this trust shall
become irrevocable.
236 (ARTICLE VI contains standard Spendthrift and Rule Against Perpetuities
provisions.)IN WITNESS WHEREOF, this instrument has been executed the
day and year first above written.
/s/ FRANCIS D. SHELDEN, Settlor
237
THE TRUST COMPANY OF THE

VIRGIN ISLANDS, LTD.


238
By: /s/ ADAM STARCHILD
Witnesses:
239 /s/ ALGER SHELDEN, JR.
240 /s/ L. BENNETT YOUNG
241 Trust Company of the Virgin Islands Ltd. has received from Francis D. Shelden
the following securities, as part of the Francis D. Shelden Inter Vivos Trust
dated 28th September, 1976.
5929 shares Detroitbank Corporation
242
1769 shares

1620 shares
15800 shares
2230 shares
200 shares
2510 shares
236
2080
100
800
400
1000
10014
3520
2654
1830

shares
shares
shares
shares
shares
shares
shares
shares
shares
shares

1118 shares
200 shares
1636 shares
450 shares
-----------40000 shares
1000 shares
1000 shares
------------

First National Bankshares of


Florida Inc.
J. P. Morgan & Co., Inc.
Hiram Walker Goderham &
Worts Ltd.
Standard Oil Co. of California
Minnesota Mining &
Manufacturing
The Murray Ohio
Manufacturing Co.
Walter Kidde Co., Inc.
Federal Mogul Corp.
Burlington Northern Inc.
Booth Newspapers Inc.
Booth Newspapers Inc.
Mobil Oil Corp.
The Dow Chemical Corp.
Ex-Cell-O Corp.
Marathon Oil Corp.
National Distillers and
Chemical Corp.
Texaco Inc.
Sears, Roebuck & Co.
Exxon Inc.
Borden Inc.
-----------------------------North Fox Island Company
Windigo Ranch, Inc.
FDS Land Company
------------------------------

243 Dated this 28th day of September, 1976.

TRUST COMPANY OF THE VIRGIN


ISLANDS LTD.
244
BY: /s/ ADAM STARCHILD
Director
APPOINTMENT OF PROTECTOR
245 I, FRANCIS D. SHELDEN, Settlor of the Francis D. Shelden Revocable Inter
Vivos Trust dated September 28, 1976, in accordance with the provisions of
Article IV, Paragraph 4.2 thereof, do hereby designate and appoint L. Bennett
Young of 877 S. Adams, Birmingham, Michigan, U.S.A. as Protector of my
said Trust, hereby vesting in him the specific authority to do and perform every
act and to exercise every power vested in or reserved to me as Settlor of said
Trust as fully as I might do, including the removal of the Trustee and the
designation of a Successor Trustee, except that such Protector shall not revoke,
amend or otherwise modify the provisions of the Trust.
Dated: October 9, 1976
/s/ FRANCIS D. SHELDEN
246
Witnesses:
247 /s/ ALGER SHELDEN, JR.
248 /s/ ADAM STARCHILD
ACKNOWLEDGEMENT OF APPOINTMENT OF PROTECTOR
249 The Trust Company of the Virgin Islands, Ltd., Trustee under the Francis D.
Shelden Revocable Inter Vivos Trust dated September 28, 1976, does hereby
acknowledge receipt of the appointment of L. Bennett Young as Protector of
said Trust and does hereby specifically acknowledge his authority as set forth
in said Trust and in the foregoing Appointment of Protector.
Dated: October 9, 1976
The Trust Company of the

Virgin Islands, Ltd.


250
By: /s/ ADAM STARCHILD
Witnesses:
251 /s/ ALGER SHELDEN, JR.
252 /s/ L. BENNETT YOUNG
ACCEPTANCE OF APPOINTMENT OF PROTECTOR
253 I, L. BENNETT YOUNG, of 877 S. Adams, Birmingham, Michigan, U.S.A. do
hereby accept my appointment as Protector of the Francis D. Shelden
Revocable Inter Vivos Trust.
Dated: October 9, 1976
/s/ L. BENNETT YOUNGWitnesses:
254
255 /s/ ALGER SHELDEN, JR.
256 /s/ ADAM STARCHILD
APPENDIX No. 2
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
Hon. Charles W. Joiner
Action No. 79-60003
NATIONAL BANK OF DETROIT
257 Plaintiff,
vs.
258

FRANCIS D. SHELDEN, et al.,


259
260 Defendants.
[Filed August 20, 1982]
261
FINDINGS OF FACT AND CONCLUSIONS OF LAW
262 Intervening Defendants, Second Successor Co-Trustees, L. Bennett Young and
Detroit Bank and Trust Company, having filed a Motion for Summary
Judgment Pursuant to Rule 56 of the Federal Rules of Civil Procedure, and
Defendant, The Trust Company of the Virgin Islands, Ltd., having filed an
Answer and Brief in Opposition thereto, and the matter having come on for
hearing in open Court with oral argument thereon, and the Court having granted
said Motion from the bench, the Court hereby specifically determines and finds
the following:
263 1. That on September 28, 1976, Francis D. Shelden, the Settlor, executed a
revocable inter vivos trust agreement.
264 2. That in said trust agreement, The Trust Company of the Virgin Islands, Ltd.
was named as trustee and received a large quantity of assets which included,
inter alia, one thousand (1,000) shares of Windigo Ranch, Inc. and one
thousand (1,000) shares of FDS Land Company.
265 3. That the one thousand (1,000) shares of FDS Land Company and the one
thousand (1,000) shares of Windigo Ranch, Inc. continue to be assets of the
trust and represent all of the outstanding shares of stock in said corporations.
266 4. That the shares of stock in FDS Land Company and Windigo Ranch, Inc. are
legally controlled by the lawful and proper trustees.
267 5. That on October 9, 1976, the Settlor, Francis D. Shelden, appointed L.
Bennett Young as the protector of the trust.
268 6. That the trust agreement gave both the Settlor and the protector of the trust
the express authority to remove trustees and appoint successor trustees.
269 7. That on April 13, 1978, the Settlor removed The Trust Company of The
Virgin Islands, Ltd. in accordance with his powers as set forth in the trust
agreement and appointed a successor trustee, Edward Brongersma.

270 8. That on April 20, 1978, Adam Starchild, on behalf of The Trust Company of
the Virgin Islands, Ltd., was personally served with removal papers in New
York City.
271 9. That on October 16, 1979, L. Bennett Young, as protector of the trust,
appointed himself and Detroit Bank and Trust Company as Successor CoTrustees under the terms of the trust agreement and removed Edward
Brongersma as successor trustee.
272 10. That on March 31, 1982, the Settlor, pursuant to a de bene esse deposition
taken pursuant to Court order, reaffirmed that his lawful and proper trustees are
L. Bennett Young and Detroit Bank and Trust Company, and that they have
been so since October 16, 1979.
CONCLUSIONS OF LAW
273 1. That the lawful and proper trustees of the Francis D. Shelden Revocable
Inter Vivos Trust are L. Bennett Young and Detroit Bank and Trust Company
as Second Successor Co-Trustees.
274 2. That L. Bennett Young and Detroit Bank and Trust Company, as the lawful
and proper trustees, are the rightful owners of all of the outstanding shares of
stock of FDS Land Company and Windigo Ranch, Inc.
275 3. That L. Bennett Young and Detroit Bank and Trust Company, as the lawful
and proper trustees, are entitled to the funds in question on deposit with the
Clerk of Court on behalf of Windigo Ranch, Inc. and FDS Land Company.
/s/ CHARLES W. JOINER
276
UNITED STATES DISTRICT
COURT JUDGE
277 KRUPANSKY, Circuit Judge, dissenting.
278 Because the majority and the district court have fundamentally erred in
identifying the fact at issue herein, I must respectfully dissent. Contrary to the
majority opinion that "the issue of fact in this interpleader action is who are the
present trustees of the Shelden trust," supra at 433, the actual dispute in this
case concerns the identity of the corporate officers of FDS Land Co. and

Windigo Ranch Inc. who may properly withdraw the funds held in the
corporate accounts of these organizations maintained at the National Bank of
Detroit (NBD). Simply put, a determination of the individual or individuals
authorized to act as the personal representative of a corporate shareholder does
not resolve the issue of the identity of the duly designated corporate officer or
agent authorized to control corporate assets.
279 Viewed properly, only the following facts are relevant. Young and Alger
Shelden, Jr. were indisputably the corporate officers of FDS Land Co. and
Windigo Ranch Inc. listed on the signature cards (withdrawal authorization) at
NBD at the time the Trust was formed. Presumably, those corporate officers
could have been removed, or additional officers with authority over corporate
accounts could have been designated only by fulfilling both of two conditions:
(a) possessing the authority to vote the corporate shares, and (b) actually taking
formal corporate action in conformity with the laws of the incorporating state
and the corporate by-laws. The Trust created by Shelden empowered the
Trustee to "vote stocks held in trust." Sec. 3.2.
280 Accordingly, the first relevant inquiry is the validity of the Trust, which,
incidently, has not been addressed. If a valid Trust existed at the time here in
issue, then any lawful Trustee would have the authority to elect corporate
officers of FDS Land and Windigo Ranch, although two separate factual
inquiries would still remain, namely (a) was the authority ever exercised, and
(b) was the exercise of the authority in conformity with the law and corporate
by-laws governing the operation of the two companies. If the Trust is not valid,
perhaps because it was created for the improper purpose of underwriting a
flight from prosecution, then the party in direct control of the stock was and is
Shelden himself, and the secondary inquiries must resolve the presence of any
evidence that he properly exercised the authority to elect the corporate officers
of FDS Land or Windigo Ranch and if that exercise of authority was lawful.
281 The district court merely determined the identity of the proper Trustee under
the Trust. Even if Shelden's de bene esse testimony is unassailable support for
that finding, the conclusion below is simply the right answer to the wrong
question. The court did not address the facts in dispute concerning the validity
of the Trust so as to determine if the authority to vote the shares now inheres in
any Trustee or remains with Shelden. Nor did the trial court find any facts
establishing the manner in which the party in control of the stock may have
utilized that authority to elect corporate officers authorized to withdraw
corporate assets from corporate accounts.
282 Thus, in sum, the district court does not appear to have scrupulously hewn to

the issue of determining the legitimate corporate officers or agents of either


corporation. Nonetheless, the facts permit a narrowing of the possible results in
this matter. First, the claimants to the money represented by TCVI argue that
the Trust may be wholly invalid. If this is true, then Shelden has, as noted
hereinabove, always had the exclusive authority to vote his stock to name
officers of the companies. Absent any evidence (and there is none) that he
voted the shares, the proper corporate officers with access to the accounts
remain Young and Alger Shelden, Jr., who are named on the original NBD
bank records. (The officers would not be Young and Detroit Bank & Trust as
found by the district judge; this confusion is again due to mistaking the identity
of the Trustee for the correct issue of identifying the corporate officers with
access to the bank accounts.) If, however, the Trust is valid, then Young and
Alger Shelden, Jr. may still be officers of FDS Land and Windigo Ranch, or the
proper Trustees may have used their authority to name new officers, although
the exercise of that authority to elect new officers, if in fact it occurred, is not
apparent in the record. However, as previously noted, merely possessing the
authority, through control of the corporate shares, to name new officers does
not resolve the inquiry as to the identity of the corporate officers, since that
authority would have to be exercised in conformity with the corporate bylaws
and the law of the incorporating state.
283 Thus, the majority is correct that TCVI, and its elected corporate officers, can
state no claim to the funds, inasmuch as a finding of Trust invalidity would
leave the authority to name officers with Shelden, and a conclusion that the
Trust is valid results in the clear finding, as stated by the majority, that Young
and Detroit Bank & Trust are the rightful Trustees and may select corporate
officers. However, as discussed, a resolution of Trust validity may still be
relevant to the real issue at bar, since resolution of the proper issue of the
officers' identity requires identifying the individual or individuals with the
authority to name officers and then determining if that authority has ever been
properly exercised. Absent an identification of the current lawful corporate
officers, it is hornbook law that a release of corporate funds to one who is
merely the personal representative of a stock owner, even if the identity of that
representative is totally certain, would be an improper conversion of corporate
assets in corporate accounts.
284 Because, on the present record, the identity of the lawful officers of FDS Land
Co. and Windigo Ranch Inc. empowered to control the corporate assets forming
the basis of the present suit remains both factually and legally unresolved, I
would reverse the grant of summary judgment and remand for a hearing on the
proper issue.

Pertinent parts of the trust instrument are made Appendix No. 1 to this opinion

The record indicates that The Trust Company of the Virgin Islands, Ltd. was
established by Starchild for the purpose of administering the Shelden trust. In
his de bene esse deposition Shelden testified that "The Trust Company of the
Virgin Islands was Adam Starchild's alter ego."

This deposition of Young was taken in the case of Shelden v. The Trust
Company of the Virgin Islands, Ltd., in which the opinion of the District Court
of Puerto Rico is published in 535 F.Supp. 667 (D. Puerto Rico 1982). That
decision is discussed in Part VI of this opinion

When the attorneys did not agree upon a date, Judge Joiner issued an order
directing that the deposition be taken in the City of Amsterdam in the
Netherlands during the week of January 25, 1982. The attorneys for Appellees
gave written notice on December 17, 1981 to counsel for Appellants that the
deposition would be taken at the offices of L.J.W.M. Schroeder, at J.W.
Brouwerg's Plein 10, Amsterdam, Netherlands on Wednesday, January 27,
1982 at 9 a.m
Counsel for Appellants gave notice of a hearing before Judge Joiner on January
12, 1982 on their motion to adjourn the de bene esse deposition. The reason
given for adjournment was the averment of the attorneys for Appellants that
they needed the assistance of Adam Starchild, founder of the Trust Company of
the Virgin Islands, Ltd., in preparing for the deposition of Francis D. Shelden;
and Starchild was incarcerated in the Passaic County Jail in New Jersey; that
Starchild's Parole Board had fixed a date for his release from jail within the
next three months, and counsel believed that Starchild would be released before
March 1, 1982. An adjournment of the Shelden deposition was requested until
after March 25, 1982.
Judge Joiner entered an order directing that Shelden's de bene esse deposition
be adjourned from January 27, 1982, and that it be taken and completed before
April 1, 1982. On March 5, 1982, Counsel for Appellees gave written notice to
counsel for Appellants that the Shelden deposition would be taken on
Wednesday, March 31, 1982 at 9 a.m. at the office of L.J.W.M. Schroeder in
Amsterdam at the address indicated in their previous notice.

The document removing The Trust Company of the Virgin Islands, Ltd. and
appointing Brongersma as first successor trustee is as follows:
REMOVAL OF A TRUSTEE AND APPOINTMENT OF A SUCCESSOR
TRUSTEE

I, FRANCIS D. SHELDEN, Settlor and Sole Beneficiary of the Francis D.


Shelden Revocable Inter Vivos Trust dated September 28, 1976 in accordance
with the provisions of Article IV, Paragraph 4.5 thereof, do hereby remove The
Trust Company of the Virgin Islands, Ltd. of Roadtown, Tortola, British Virgin
Islands as Trustee, and do hereby nominate and appoint EDWARD
BRONGERSMA, of Tetterodewag 1, Overveen, the Netherlands to act as
Successor Trustee of my said Trust.
I hereby invest EDWARD BRONGERSMA, the Successor Trustee, with full
powers and authority, to request full account of the original Trustee on all
matters related with my said Trust, to discharge upon such rendering of account
the original Trustee from all responsibility in relation with my said Trust and to
make all necessary arrangements to compensate the original Trustee for his
services and reimburse him for all reasonable expenses incurred in the
management and conservation of my said Trust Estate.
Dated April 13, 1978

/s/

(Seal)

Kingdom of the
Netherlands
Province of North
Holland
City of Amsterdam
Consulate General of
the
United States of
America

FRANCIS D. SHELDEN
Seen by me, Mr. Leo Johannes Willem Marie Schroe
notaris, having his office in Amsterdam, for
for legalisation of the signature hereabove of
Mr. Francis D. Shelden.
Amsterdam, April 13th, 1978.
Signed by L. J. W. M. Schroeder
BRITISH CONSULATE GENERAL AMSTERDAM
Date 13 April, 1978
for the legailisation of the signature and
seal (overleaf) of Mr. L. J. W. M. Schroeder, a
Notary Public of Amsterdam, the Netherlands.
(Signature not legible)
British Vice-Counsul

)
)
)
)

SS

I, Melvin M. Tano Consul of the United States of America at Amsterdam, The


Netherlands, duly commissioned and qualified, do hereby certify that L.J.W.M.
SCHROEDER whose true signature and official seal are respectively
subscribed and affixed to the annexed document was at the time he signed the
annexed document a NOTARY at AMSTERDAM, The Netherlands, to whose
official acts faith and credit are due.
IN WITNESS WHEREOF I hereunto set my hand and the seal of the Consulate

General of the United States at Amsterdam, The Netherlands, this 13 day of


Apr 1978.
/s/ MELVIN M. TANO
Consul of the United States
duly commissioned and qualified
6

ACCEPTANCE OF APPOINTMENT
OF SUCCESSOR TRUSTEE
I, EDWARD BRONGERSMA, of Tetterodeweg 1, Overveen, the Netherlands,
hereby accept my appointment as Successor Trustee of the Francis D. Shelden
Revocable Inter Vivos Trust, and hereby accept to possess and exercise all
powers and authority conferred on the original Trustee by the said Trust
instrument dated September 28, 1976 and conferred on me by the instrument
dated 13 April 1978 to appoint me as Successor Trustee.

Dated: 13 April 1978


/s/

Kingdom of the Netherlands


Province of North Holland
City of Amsterdam
Consulate General of the
United States of America

)
)
)
)
)

EDWARD BRONGERSMA
Date 13 April 1978
For the legailsation of the signature and
seal (overleaf) of L. J. W. M. Schroeder,
a Notary Public of Amsterdam, the
Netherlands
(Signature not legible)
British Vice-Counsul
SS

I, Melvin M. Tano Consul of the United States of America at Amsterdam, The


Netherlands, duly commissioned and qualified, do hereby certify that L.J.W.M.
Schroeder whose true signature and official seal are, respectively, subscribed
and affixed to the annexed document, was at the time he signed the annexed
documents a NOTARY, at AMSTERDAM, The Netherlands, to whose official
acts faith and credit are due.
IN WITNESS WHEREOF I hereunto set my hand and the seal of the Consulate
General of the United States at Amsterdam, The Netherlands, this 13 day of
APR 1978.

/s/ MELVIN M. TANO


Consul of the United States
duly commissioned and qualified
7

The deposition of Antoon Kasdorp is as follows:


Antoon Kasdorp deposes and states as follows:

That I am an attorney licensed to practice law at the bar of Amsterdam in The


Netherlands and represent Francis D. Shelden

That if called upon to do so, I could testify to the matters stated in this affidavit
since they are made from my personal knowledge

That in April 1978 I personally drafted the documents hereinafter described


removing the Trust Company of the Virgin Islands, Ltd. as Trustee of the
Francis D. Shelden Revocable Inter Vivos Trust, dated 28 September 1976, and
appointing Edward Brongersma as Successor Trustee

That Francis D. Shelden personally authorized and commissioned these actions


and further instructed me to travel to the United States and personally serve
Adam Starchild with the removal documents

That I went to the United States and personally served Adam Starchild with the
Removal of Trustee and Appointment of Successor Trustee dated 13 April 1978
and Acceptance of Appointment of Successor Trustee dated 13 April 1978 on
20 April 1978 in the city of New York, N.Y
Antoon Kasdorp
Amsterdam,
The undersigned,
Meester Leo Johannes Willem Marie Schroeder, notaris with office in
Amsterdam,
declares that the signature on the reverse side is the signature of Meester
Antoon Kasdorp, a lawyer in Amsterdam, who has solemnly affirmed before
me, notaris, that his statement is the truth, the whole truth and nothing but the
truth.

Amsterdam, April 1, 1982


(seal)
(signature)
8

REMOVAL OF TRUSTEE AND APPOINTMENT


OF SUCCESSOR TRUSTEES
I, L. BENNETT YOUNG, Protector of the Francis D. Shelden Revocable Inter
Vivos Trust dated September 28, 1976, in accordance with the authority vested
in me by the Appointment of the Settlor, Francis D. Shelden, dated October 9,
1976, a copy of which is attached hereto, and in accordance with the authority
vested in me by virtue of the provisions of Article IV, Section 4.2 of said Trust,
do hereby remove Edward Brongersma of Tetterodeweg 1, Overveen, The
Netherlands, as Successor Trustee and do hereby designate and appoint L.
BENNETT YOUNG of 877 South Adams Road, Birmingham, Michigan
48011, and The Detroit Bank & Trust Company of Detroit, Michigan, as
Successor Trustees, hereby vesting said Successor Trustees with full authority
to do and perform every act and to exercise every power as Trustees permitted
or granted by the Trust Instrument.
I hereby specifically recognize the removal by the Settlor of the original
Trustee, The Trust Company of the Virgin Islands, Ltd. and the appointment of
Edward Brongersma as Successor Trustee by instrument dated April 13, 1978,
a copy of which is attached hereto.
/s/ L. BENNETT YOUNG
Witnesses:
/s/ DAVID C. WIND
/s/ WILLIAM G. BUTLER
STATE OF MICHIGAN )
) SS
COUNTY OF WAYNE )
Subscribed and sworn to before me this 16th day of October, 1979.
Anastasia D. Lacen

Notary Public, Wayne County, Mich.


My Commission expires June 20, 1983
9

SETTLOR'S ACKNOWLEDGEMENT OF
REMOVAL OF TRUSTEE AND
APPOINTMENT OF SUCCESSOR TRUSTEES
I hereby acknowledge and affirm the removal of EDWARD BRONGERSMA
as Successor Trustee of my Revocable Inter-Vivos Trust dated September 28,
1976, by the action of L. BENNETT YOUNG, Protector of my said Trust, by
written instrument dated October 16, 1979, and I further accept and affirm the
appointment by the said Protector of my said Trust of L. BENNETT YOUNG
and THE DETROIT BANK & TRUST COMPANY, as Successor Trustees
with all powers and authority granted to them by the said written instrument
dated October 16, 1979, and under the provisions of my said Trust.
/s/ FRANCIS D. SHELDEN
Dated: 13 November, 1979.
Witnesses:
/s/ (signature not legible)
/s/ (signature not legible)
Seen by me, Meester Leo Johannes Willem Marie Schroeder, notaris with
office in Amsterdam for legalisation of the signatures hereabove of Mr. Francis
Duffield Shelden, Mr. Hendricus Marinus van der Schroeff and Miss.
Petronella Hendrica Cornelia Maria Perguin, all of them are known to me.
Amsterdam, 16th November 1979.
(signature)
(seal)

10

ACKNOWLEDGEMENT OF
REMOVAL OF SUCCESSOR TRUSTEE
I, EDWARD BRONGERSMA, of Tetterodeweg 1, Overveen, The Netherlands,

hereby acknowledge and accept my removal as Successor Trustee of the


Francis D. Shelden Revocable Inter-Vivos Trust dated September 28, 1976, by
the action of L. BENNETT YOUNG, Protector of said Trust, by written
instrument dated October 16, 1979.
/s/ EDWARD BRONGERSMA
Dated: 13 Nov. 1979
Witnesses:
/s/ (signature not legible)
/s/ (signature not legible)
Seen by me, Meester Leo Johannes Willem Marie Schroeder, notaris with
office in Amsterdam for legalisation of the signatures hereabove of Mr. Edward
Brongersma, Mr. Hendricus Marinus van der Schroeff and Miss. Petronella
Hendrica Cornelia Maria Perguin, all of them are known to me.
Amsterdam, 16th November 1979.
(signature)
(seal)
11

Edward Brongersma deposes and states as follows:

That I reside at Tetterodeweg 1, Overveen, The Netherlands

That on 13 April 1978 I was appointed and accepted the appointment of


Successor Trustee of the Francis D. Shelden Revocable Inter Vivos Trust dated
28 September 1976

That on 13 April 1978 I executed a document entitled Acceptance of


Appointment of Successor Trustee

That on 16 November 1979 I executed a document entitled Acknowledgment of


Removal of Successor Trustee and accepted my removal as Successor Trustee
by action of L. Bennett Young as Protector of said Trust

That at no time have I received any assets or property of any nature whatsoever
belonging to said Trust from the Trust Company of the Virgin Islands, Ltd.
Adam Starchild or any other person connected with said Trust

That at no time have I ever received an accounting from the Trust Company of
the Virgin Islands, Ltd. of its activities as my predecessor Trustee nor have I
ever received such an accounting from Adam Starchild or any other person
connected with said Trust
/s/ EDWARD BRONGERSMA
Amsterdam,

12

See Part VI of this opinion, infra

13

See Part VI of this opinion, infra

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